According to the Department of Energy, USA crude oil imports averaged over 7.0 million barrels per day last week, down by 439,000 barrels per day from the previous week.
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“With the Federal Reserve holding off on interest rates hikes on Wednesday, the market will keep watch on the December meeting where a rate hike is likely in play”, said Sanjeev Gupta, head of the Asia Pacific oil and gas practice at professional services firm EY. “We’re seeing strong demand for gasoline, diesel and jet fuel in the US Even through crude supplies are high, there seems to be a little bit of a shift in sentiment”. The good period for refiners have also ended as lower oil prices are also affecting them.
Crude oil prices recovered a few lost ground in early Wednesday trading, though most signs continue to show the markets are heavily favoring the supply side. Distillate stockpiles, which include heating oil, declined by a more-than-expected 3 million barrels.
“We do not expect the FOMC to change policy this week”, Nomura Securities said in a market commentary.
Oil price is down, however lack of investments in the sector make prices vulnerable to supply shocks in future.
On the demand side, Energy Aspects said that it “forecast a sharp slowdown in global oil demand across Q4 15 at 0,8 million barrels per day, which marks the slowest pace of growth in five quarters”.
Gasoline stockpiles dropped 1.14 million barrels to 218.6 million as demand jumped to the highest since August.
Last Friday, oil prices stretched losses into a second week, with WTI down $US2.02 for the week and Brent shedding $US1.94.
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Speaking at Singapore global Energy Week on Monday, he said it would be the first time in two decades that oil investment declines for two consecutive years. The downstream segment companies refined oil, and also took advantage of exporting refined products. When oil and other commodities such as gold see major price action this usually bodes well in terms of volumes for venues offering futures contracts and brokers offering CFD and spot oil price instruments.
